Safestore Q4 revenue rises amid strong UK performance

Self-storage provider Safestore posted an 11.3% rise in fourth-quarter revenue on Thursday as occupancy increased and the company sounded an upbeat note on the outlook.

In the four months to the end of October, revenue pushed up to £38.3m from £34.4m, with like-for-like revenue up 5.6% to £35.7m.

Group LFL average occupancy for the year was up 4.4% and group LFL average storage rate for the year was up 0.2%.

Safestore said performance was strong across all of the UK, with revenues in London and the South East up 5.1% and regional UK revenue up 8.3%.

Chief executive officer Frederic Vecchioli said: "I am pleased to report improving trading momentum has driven a strong fourth quarter, concluding another excellent year's performance. The Alligator portfolio of twelve stores, acquired at the beginning of the financial year, is fully integrated and performing well. The year's new store openings at London Mitcham, Paddington Marble Arch and Paris-Poissy are trading in line or ahead of our business plans.

"Further to our successful openings this year, we plan to open new stores in London-Carshalton, Paris-Pontoise, Paris-Magenta and Birmingham-Merry Hill in the 2018/2019 financial year."

Safestore expects its adjusted diluted EPRA earnings per share to be in line with consensus of between 26p and 26.8p for the year ended 31 October 2018.

"Our strong market positions and geographical diversity means that we believe we are well placed to withstand any macroeconomic uncertainty in the UK and we look forward with confidence to the 2018/19 financial year," it said.

Liberum said rising long-term demand for storage space, above-average barriers to entry and latent occupancy and rate upside all underpin long-term growth potential at Safestore.

"We still see almost 70% earnings upside to Safestore from its existing store portfolio, with additional growth as it expands its footprint and rates. Safestore’s cash generative model enhances its attraction."

At 1030 GMT, the shares were down 4.6% to 524p.